It should aim for a contained fiscal deficit and take the economy back on the accelerated growth path. A budget aimed at economic growth could lead to a market rally in March, said Mahajan.

"With results season almost over, the street will look forward to passage of various important bills like insurance, pension etc in the budget session of the Parliament," he added.

According to Mahajan the correction in market is an opportunity for the investors to enter it. "We recommend investors to buy quality stocks with focus on rate-sensitive sectors like financials, auto, reforms-led sectors like oil and gas and media. With revival in US economy, IT can emerge as a dark horse for FY14," Mahajan added.

Mahajan's comments come in the backdrop of disappointing December IIP numbers. IIP for the month of December contracted at (-) 0.6% versus (-)0.1% in the month of November.

The manufacturing sector output contracted at (-) 0.7% versus a growth of 0.3% in November. This is the worst output growth since September.

The consumer goods sector output contracted at (-)4.2% versus a growth of 1% in November. Factory output has been hurt by relatively weak global trade, especially from Europe, India's largest trade partner, with the debt-ravaged euro zone economy expected to contract again this year.